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Hawkins' Shares Rally 37% in 3 Months: What's Driving the Stock?

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Hawkins, Inc.’s (HWKN - Free Report) shares have increased 36.8% in the past three months compared with the S&P 500 and the industry’s growth of 4.6% and 3.9%, respectively.

Zacks Investment Research
Image Source: Zacks Investment Research

Let’s look at the factors driving the stock’s price appreciation.

What’s Driving Hawkins’ Stock Surge?

The primary catalyst behind HWKN’s price appreciation is its strong fiscal first-quarter performance and an optimistic outlook for the company’s Water Treatment division. In the first quarter of fiscal 2025, the Water Treatment segment posted impressive 25% year-over-year growth, with sales reaching $117.2 million. Contributions from recent acquisitions largely drove this growth.

Hawkins has been focused on expanding its Water Treatment business through strategic acquisitions. One such move was the acquisition of Industrial Research Corporation, a supplier of water treatment chemicals and equipment operating in Louisiana, Texas and Arkansas. This acquisition is part of Hawkins' broader strategy to strengthen its footprint in these regions and foster strong community ties built by Industrial Research.

Additionally, the acquisition of Wofford Water Service extended Hawkins' reach into Mississippi, marking a significant expansion into the southern U.S. market, where the company previously had a limited presence. These acquisitions highlight Hawkins’ commitment to broadening its market share in the Water Treatment industry.

The company exceeded expectations in its fiscal first quarter, reporting earnings of $1.38 per share, well above the Zacks Consensus Estimate of $1.01. Hawkins has outperformed earnings estimates in three of the past four quarters, with an average surprise of 15%. The Zacks Consensus Estimate for fiscal 2025 earnings is $4.14 per share, implying 15.3% year-over-year growth. In the past 90 days, the consensus estimate for fiscal 2025 has seen an upward revision of 15%, further boosting investor confidence in the company’s prospects.

HWKN’s Zacks Rank & Other Key Picks

Hawkins currently carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the Basic Materials space are IAMGOLD Corporation (IAG - Free Report) , Eldorado Gold Corporation (EGO - Free Report) and Carpenter Technology Corporation (CRS - Free Report) . IAMGOLD, Eldorado Gold and Carpenter Technology each sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for IAMGOLD’scurrent-year earnings is pegged at 41 cents per share, indicating a rise of 355.6% from the year-ago level. IAG’s earnings beat the consensus estimate in each trailing four quarters, with the average surprise being 200%. The stock has surged nearly 152.5% in the past year.

The Zacks Consensus Estimate for Eldorado Gold’s current year earnings is pegged at $1.35 per share, indicating a year-over-year rise of 136.8%. EGO beat the consensus estimate in each trailing four quarters, with the average earnings surprise being 430.3%. The company's shares have surged nearly 82.9% in the past year.

The Zacks Consensus Estimate for Carpenter Technology’scurrent-year earnings is pegged at $6.09 per share, indicating a rise of 28.5% from the year-ago level. CRS’ earnings beat the consensus estimate in each of the trailing four quarters, the average earnings surprise being 15.9%. The stock has surged nearly 124.7% in the past year.

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